Tesla says Musk should be paid $1tn - will shareholders agree?
It's not clear that everyone is singing from the same hymn sheet.
BBC
Ahead of Tesla's annual general meeting (AGM) on Thursday there's been one key message the electric car-maker has been hammering home to shareholders: the boss is worth $1tn.
It has taken out digital ads to make the case for Elon Musk's proposed bumper pay package, while Votetesla.com features a video of board chair Robyn Denholm and director Kathleen Wilson-Thompson praising him, as triumphant music crescendos in the background.
It's not clear that everyone is singing from the same hymn sheet though, meaning the AGM in Austin, Texas is set to become a referendum on Musk himself, after a rightward political turn which has made him one of the most polarising chief executives in recent memory.
Musk himself has taken to X - which he owns - to raise the stakes higher still, saying the fate of Tesla "could affect the future of civilization."
Not everyone agrees
He's also used his social media megaphone to amplify some of the deal's high-profile backers, including Dell Technologies' Michael Dell, Ark Invest CEO Cathie Wood, and his brother, Kimbal, who sits on the Tesla board.
"There is no one remotely close to my brother," Kimbal said, extolling his sibling's leadership qualities.
"Thanks bro ," Musk replied.
For some, the focus on Musk and the soap opera around his pay is symptomatic of how the car firm - which has seen sales slide - has lost its way under his leadership.
"What's amazing to me is a company struggling to sell cars spends money on advertising to sell a pay package," said Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management.
Gerber has pared back his Tesla holdings in recent years - and turned up his criticism of the direction it's heading in.
"[Tesla] needs to change the focus of the company back to its core – to selling EVs again," he said.
The trillion dollar man
The deal Tesla wants shareholders to back is not a salary of a one followed by twelve zeroes.
Instead, it sets Musk the target of raising Tesla's market value to $8.5tn, from $1.4tn at the time of writing.
He would also have to oversee a massive boom in the company's self-driving "Robotaxi" cars, getting a million of them into commercial operation - no small deal given their underwhelming launch.
Do that, among meeting other benchmarks, and Musk would be given 423.7 million new shares, which would be worth nearly $1tn if the target valuation is reached.
Tesla did not respond to the BBC's requests for comment about its strategy to garner support from shareholders.
Of course, this is not the first pay controversy Musk and Tesla have become embroiled in.
Previously, Tesla got shareholders to twice ratify a pay package for Musk that was worth tens of billions of dollars if he achieved a tenfold increase in Tesla's market value.
He met that milestone but, in 2024, a Delaware judge rejected the deal on the grounds that Tesla's board members were too personally and financially enmeshed with the company's boss.
The Delaware Supreme Court is reviewing that decision - even as deliberations continue over this even larger pay package.
Poster child
"The strategy is more of the same from Tesla, which is not to say that this is normal. Nothing about Tesla is normal," Dorothy Lund, a professor at Columbia Law School told BBC News.
"They're not a poster child for good corporate governance."
Professor Lund said get-out-the-vote campaigns like this sometimes take place when a company is worried, for example. about an activist shareholder forcing significant changes to how it operates, such as who is on its board of directors.
"[But] never in my life have I seen something like that happen in the context of a compensation decision," Professor Lund said.
And unlike the vote on that earlier compensation package, Elon and Kimbal Musk will both get to vote as they push to reach the majority threshold required to seal the deal.
Musk is already the world's richest man, becoming the first known half-trillionaire earlier this year.
9Tesla's argument in support of the pay package rests on the idea that Musk might leave the company if shareholders don't follow the board's recommendation and approve the pay package. Read the whole story here: https://www.bbc.com/news/articles/cn4j0yg1drgo
Ahead of Tesla's annual general meeting (AGM) on Thursday there's been one key message the electric car-maker has been hammering home to shareholders: the boss is worth $1tn.
It has taken out digital ads to make the case for Elon Musk's proposed bumper pay package, while Votetesla.com features a video of board chair Robyn Denholm and director Kathleen Wilson-Thompson praising him, as triumphant music crescendos in the background.
It's not clear that everyone is singing from the same hymn sheet though, meaning the AGM in Austin, Texas is set to become a referendum on Musk himself, after a rightward political turn which has made him one of the most polarising chief executives in recent memory.
Musk himself has taken to X - which he owns - to raise the stakes higher still, saying the fate of Tesla "could affect the future of civilization."
Not everyone agrees
He's also used his social media megaphone to amplify some of the deal's high-profile backers, including Dell Technologies' Michael Dell, Ark Invest CEO Cathie Wood, and his brother, Kimbal, who sits on the Tesla board.
"There is no one remotely close to my brother," Kimbal said, extolling his sibling's leadership qualities.
"Thanks bro ," Musk replied.
For some, the focus on Musk and the soap opera around his pay is symptomatic of how the car firm - which has seen sales slide - has lost its way under his leadership.
"What's amazing to me is a company struggling to sell cars spends money on advertising to sell a pay package," said Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management.
Gerber has pared back his Tesla holdings in recent years - and turned up his criticism of the direction it's heading in.
"[Tesla] needs to change the focus of the company back to its core – to selling EVs again," he said.
The trillion dollar man
The deal Tesla wants shareholders to back is not a salary of a one followed by twelve zeroes.
Instead, it sets Musk the target of raising Tesla's market value to $8.5tn, from $1.4tn at the time of writing.
He would also have to oversee a massive boom in the company's self-driving "Robotaxi" cars, getting a million of them into commercial operation - no small deal given their underwhelming launch.
Do that, among meeting other benchmarks, and Musk would be given 423.7 million new shares, which would be worth nearly $1tn if the target valuation is reached.
Tesla did not respond to the BBC's requests for comment about its strategy to garner support from shareholders.
Of course, this is not the first pay controversy Musk and Tesla have become embroiled in.
Previously, Tesla got shareholders to twice ratify a pay package for Musk that was worth tens of billions of dollars if he achieved a tenfold increase in Tesla's market value.
He met that milestone but, in 2024, a Delaware judge rejected the deal on the grounds that Tesla's board members were too personally and financially enmeshed with the company's boss.
The Delaware Supreme Court is reviewing that decision - even as deliberations continue over this even larger pay package.
Poster child
"The strategy is more of the same from Tesla, which is not to say that this is normal. Nothing about Tesla is normal," Dorothy Lund, a professor at Columbia Law School told BBC News.
"They're not a poster child for good corporate governance."
Professor Lund said get-out-the-vote campaigns like this sometimes take place when a company is worried, for example. about an activist shareholder forcing significant changes to how it operates, such as who is on its board of directors.
"[But] never in my life have I seen something like that happen in the context of a compensation decision," Professor Lund said.
And unlike the vote on that earlier compensation package, Elon and Kimbal Musk will both get to vote as they push to reach the majority threshold required to seal the deal.
Musk is already the world's richest man, becoming the first known half-trillionaire earlier this year.
9Tesla's argument in support of the pay package rests on the idea that Musk might leave the company if shareholders don't follow the board's recommendation and approve the pay package. Read the whole story here: https://www.bbc.com/news/articles/cn4j0yg1drgo
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